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SBN member countries’ sustainable finance development achievements & actions in 2020

December 19,2020

Since SBN inception in 2012, there are total 69 policies/principles launched by 26 member countries in total. In 2020 alone, over a quarter of SBN’s 41 member countries issued new sustainable finance policies/principles/roadmaps/guidelines.

Amid the global pandemic, SBN member countries have been promoting sustainable finance more proactively to promote growth and build resilience. We see their achievements and actions frequently in the following forms by the financial regulators and industry associations:

ü  Joining SBN to be part of the international community committed to advancing sustainable finance in line with international good practice
ü  Issuing new national sustainable finance policies/guidelines/policy documents
ü  Adding sustainable finance to the countries’ highest-level strategic development plans
ü  Creating new entities focusing on promoting sustainable finance, usually cross-sector, inter-agency, and public-private
ü  Publishing technical reports and case studies on sustainable finance related topics
ü  Making public statement committed to sustainable finance by top-level government officials
ü  Organizing awareness raising and capacity building events
ü  Conducting peer-to-peer learning with fellow SBN members
ü  Singing MOU with IFC

Below is a list of sample achievements and actions related to national sustainable finance development and implementation by SBN member countries in 2020.


JOINING SBN TO BE PART OF THE INTERNATIONAL COMMUNITY COMMITTED TO ADVANCING SUSTAINABLE FINANCE IN LINE WITH INTERNATIONAL GOOD PRACTICE

·       In July, the National Securities and Stock Market Commission of Ukraine (NSSMC) joined SBN. NSSMC is committed to promoting sustainable finance in Ukraine by developing the Sustainable Finance Roadmap, adopting green finance guidelines, ESG Scorecard and ESG Disclosure Guidelines.
·       In September, the Mongolia Sustainable Finance Association (MSFA) joined SBN. MSFA served as one of the SBN IDA Task Force co-chairs, which delivered the recent report “Necessary Ambition: How Low-Income Countries Are Leveraging Sustainable Finance to Address Poverty, Climate Change, and Other Urgent Challenges.” The mission of MSFA is to foster Mongolia as a regional sustainable finance knowledge hub by helping members integrate ESG and sustainability practices in their operations and promoting green and climate finance.
·       In November, the National Bank of Ukraine joined SBN. NBU is committed to achieve progress in promoting sustainable finance in the banking sector of Ukraine within the next two years, both at the level of sustainable finance products and sound environmental, social, and corporate governance (ESG) practices by financial nstitutions.
·       In November, the 
Association of Serbian Banks (ASB) joined SBN. ASB is committed to investing in national and regional progress in sustainable finance. 


ISSUING NEW NATIONAL SUSTAINABLE FINANCE POLICIES/GUIDELINES/POLICY DOCUMENTS

·       In February, the National Bank of Georgia launched the ESG Reporting and Disclosure Principles, which guides the Georgian Commercial banks in ESG reporting and disclosure aligned with international good practices.
·       In April, Bangko Sentral ng Pilipinas, the Philippines’ central bank, issued the country's first Sustainable Financial Framework, requiring banks to integrate environmental and social risk management in their corporate governance and risk management frameworks, as well as in their strategic objectives and operations.
·       The ASEAN Capital Markets Forum (ACMF) under Vietnam ASEA Chairmanship launched its “Sustainable Capital Market Roadmap. This five-year Roadmap sets out a holistic approach to catalyze sustainable finance in ASEAN capital markets.
·       South Africa’s Johannesburg Stock Exchange (JSE) widened the instructions and expanded its Green Bond Segment to a new Sustainability Segment, which makes it easier to list and trade sustainability-related instruments.
·       Central Bank of Mongolia announced its national Green Loan Statistics (unofficial English translation), calculating the amount and ration of green loans in the portfolio based on the taxonomy.
·       On July 21, People's Bank of China (PBOC) released a public consultation draft of its Notification on Evaluation of Green Finance Performance of Deposit-Type Financial Institutions in the Banking Industry (in Chinese). The proposal extends green evaluation coverage from green credit to include more financing tools, such as securities, investments, leasing, and trusts. Read more in English here.
·       In August, National Banking and Insurance Commission (CNBS) of Honduras issued Standard for the Management of Environmental and Social Risk applicable to the Institutions of the Financial System, the first national sustainable finance policy issued in the country. The document sets the standards for financial institutions to manage their environmental and social risk.
·       In September , the Superintendencia Financiera de Colombia also published a Good Practice Guide for Issuing Green Bonds (in Spanish), which includes recommendations related to project selection and evaluation, fund management, and information disclosure. It also issued External Circular 028 of 2020 (in Spanish), which formally incorporates the definition of Green Bond, which makes Colombia the first country in the region to have an exclusive regulatory framework for this type of thematic bonds.
·       In September, The Mongolian Sustainable Finance Association, with IFC support, recently translated the Mongolia Green Taxonomy, issued in December 2019, into English for international collaboration and knowledge exchange.
·       In October, the Association of Southeast Asian Nations (ASEAN) held its 6th Meeting of Finance Ministers and Central Bank Governors, co-chaired by the State Bank of Vietnam and the Vietnam Ministry of Finance. The meeting welcomed the ASEAN Central Banks’ Agenda on Sustainable Banking and a report on the role of ASEAN central banks in addressing climate and environmental risks and promoting sustainable finance. The ASEAN countries jointly commit to i) ASEAN-wide taxonomy; (ii) ASEAN-specific green lending principles; and (ii) supervisory guidelines to support the banks in integrating climate and environment-related risks into their risk management framework.
·       In November, the Peru Ministry of Environment, jointly with 3 financial sector associations, relaunched the Green Protocol of Peru with added content to promote environmental risk management by financial institutions and deepen sustainable development in the financial sector.
·       In November, the Fiji Government launched the 2nd round of public consultation of the Climate Change Bill, which includes a section on sustainable finance, outlining the government’s authority and responsibility to promote and oversee climate finance.
·       In November, Chilean Superintendencia de Pensiones (the pensions regulator in Chile) passed a new rule to require ESG and climate risk to be part of the investment analysis of country's pension funds.
·       In December, the ASEAN Capital Markets Forum set the priorities of the next 5 years, including sustainability disclosure and sustainability-linked bonds. The ASEAN Chairmanship will transition to Brunei for 2021.


ADDING SUSTAINABLE FINANCE TO THE COUNTRIES
HIGHEST-LEVEL STRATEGIC DEVELOPMENT PLANS

·       In early 2020, Indonesia launched its 2020-2024 National Medium-Term Development Plan, which incorporated climate change into the mainstream of Indonesia's broader Low Carbon Development (LCDI) strategy.
·       In October, South Africa announced its National Economic Reconstruction and Recovery Plan. Highlighting green economic interventions and a sustainable recovery trajectory, the Plan serves as a green recovery blueprint for rebuilding and growing the economy with sustainability, resilience, and inclusion as priorities.
·       In December, the Philippines Congress adopted House Resolution No. 1377, declaration a climate emergency and listing sustainable development and resilient investment planning, programming and financing as one of the core mandates.


CREATING NEW ENTITIES FOCUSING ON PROMOTING SUSTAINABLE FINANCE, USUALLY CROSS-SECTOR, INTER-AGENCY, AND PUBLIC-PRIVATE

·       In April, The Superintendencia Financiera de Colombia (Financial Superintendence of Colombia, or SFC) created the Sustainable Finance Working Group to implement SFC's sustainability strategy, including a sustainable finance taxonomy, ESG integration by financial institutions, climate risk, and capacity building.
·       In August, Ecuador launched the Iniciativa de Finanzas Sostenibles (Sustainable Finance Initiative, or IFS), led by the Banco Central del Ecuador (BCE, the central bank of Ecuador). The IFS is an innovative public-private-academic collaboration to promote sustainable finance in Ecuador, aligning with international standards and good practice.
·       In August, India held a national public-private Sustainable Finance Collaborative, which led a 3-day consultation to mobilize sustainable and green finance, led by the Department of Economic Affairs, Ministry of Finance, and the United Nations Development Programme.


PUBLISHING TECHNICAL REPORTS AND CASE STUDIES ON SUSTAINABLE FINANCE RELATED TOPICS

·       In March, the Central Bank of Egypt (CBE) has taken proactive precautionary measures to curb and offset the negative implications of the COVID-19 virus outbreak since March. In June, CBE shared an SBN Case Study on its measurements to ensure the safety of individuals and the continuity and viability of businesses.
·       In March, the Kenya Bankers Association (KBA) launched a comprehensive pandemic response and shared it in May as an SBN Case Study. Actions include policy interventions, a research study, a phased crisis response plan, awareness raising, capacity building, and other stakeholder engagement activities.
·       In April, South Africa's National Treasury published “Financing A Sustainable Economy: Technical Paper 2020for public comment, outlining its vision for achieving policy coherence, regulatory guidance, oversight, and capacity building for sustainable finance across all parts of the financial sector.
·       In April, Mexico Central Bank published "Climate and environmental risks and opportunities in Mexico's financial system: from diagnosis to action, encouraging financial institutions to incorporate environmental issues into their risk assessment and corporate governance strategies, as well as to promote green finance.
·       South Africa's Reserve Bank, the central bank of the country, published the working paper "Climate change and its implications for central banks in emerging and developing economies" (June 2020), which explores how emerging market and developing country central banks might develop policy responses.
·       In September, The Banco de la República, Colombia (the central bank of Colombia) published the paper Climate Change: Policies to Manage Its Macroeconomic and Financial Effects. The paper focuses on how financial policies can help improve transparency and climate-related risk disclosure in financial institutions’ balance sheets and assets prices, and how those risks could be taken into account in monetary policy and central banks’ balance sheets and operations.
·       In October, South Africa published A Project Briefing Report on Developing a National Green Finance Taxonomy, based on its comprehensive stakeholder consultation to develop a national green finance taxonomy. Read more at the South Africa Sustainable Finance Initiative Taxonomy Working Group website.
·       In December, the South Africa Financial Sector Conduct Authority (FSCA), jointly with IFC, published the Sustainable Finance Practices in South Africa Retirement Funds Report, the first of this type in emerging markets.


MAKING PUBLIC STATEMENT COMMITTED TO SUSTAINABLE FINANCE BY TOP-LEVEL GOVERNMENT OFFICIALS

·       On July 21, the Governor of Bangko Sentral ng Pilipinas (BSP, the central bank of the Philippines), Mr. Dionkno, recently set out a comprehensive vision for leveraging sustainable finance to fortify the national pandemic recovery. His speech calls on banks to issue social and sustainability bonds, increase digital banking and financial inclusion, and strengthen environmental and social risk management systems to manage physical and transition risks.
·       In October 17th, Indonesia Finance Minister Sri Mulyani Indrawati made a statement highlighting the country's commitment to reducing carbon emissions and achieving climate resilience.
·       In November, the Fiji Attorney General, Minister of Economy, and Minister Responsible for Climate Change, Mr. Aiyaz Sayed-Khaiyum made a public statement on the importance of the Fiji Climate Change Bill.
·       In November, Bangko Sentral ng Pilipinas (the central bank of Philippines) Governor Benjamin E. Diokno made a public statement emphasizing that banks and regulators can no longer afford to ignore climate change or sustainability issues, which should be a governance priority. 
·       In December, Bangko Sentral ng Pilipinas (the central bank of Philippines) Governor Benjamin E. Diokno made a public statement emphasizing that companies' corporate strategies and risk management processes must integrate sustainability principles, including climate change and ESG risk management.
·       In December, Mr. Yi Gang, the Governor of the People’s Bank of China (PBOC), in a recent public statement, flagged the further efforts to improve the country’s green financing standards and laid out the key focal points for PBOC’s efforts to improve China’s green financing system.

 

ORGANIZING AWARENESS RAISING AND CAPACITY BUILDING EVENTS

·       In February, SBN, joined by the Mongolian Sustainable Finance Association and Climate Bonds Initiative, hosted the Trends in Taxonomy Development and Lessons from Emerging Markets.
·       In April, SBN, Tsinghua University Green Finance Center, and World Bank Global Knowledge and Research Hub in Malaysia, co-hosted the webinar Environmental Information Disclosure by Financial Institutions and Green Bond Issuers.
·       On June 5th, the Nigeria Stock Exchange is hosting a webinar "Fundamentals of Developing Green Bond Markets", the inaugural edition of its Webinar Series on Sustainable Capital Markets for West Africa.
·       In June, SBN, joined by the Bangladesh Bank, Mongolian Sustainable Finance Association, Nigeria Central Bank, and Kenya Bankers Association, hosted the webinar Rebuilding Resilience through Sustainable Finance to launch the report Necessary Ambition: How Low-Income Countries Are Adopting Sustainable Finance to Address Poverty, Climate Change, and Other Urgent Challenges.
·       In the summer, the Superintendencia Financiera de Colombia (SFC, the financial superintendence of Colombia) launched its Sustainable Finance website (in Spanish) to share its sustainability and climate change agenda. The initiative aims to promote green finance and the management of environmental and climate risk.
·       In July, the National Treasury of South Africa, IFC, Carbon Trust, and South Africa’s National Business Initiative (NBI) jointly hosted the webinar Competitiveness in South Africa – Exploring the Role of a South Africa Green Finance Taxonomy.
·       In August, the Kenya Banking Association and SBN jointly hosted the webinar Green Finance Supply and Demand Dynamics in Times of COVID.
·       In November, Bangko Sentral ng Pilipinas (the central bank of Philippines) hosted a webinar on climate risk, during which the Governor Benjamin E. Diokno emphasized that said banks and regulators can no longer afford to ignore climate change or sustainability issues as a governance priority.
·       In November, Banco Central do Brasil (the central bank of Brazil) hosted a series of webinar on Regulatory Initiatives Based on the Sustainability Dimension (sessions on 11/24, 11/25, and 11/26) as part of its Sustainability Agenda.
·       In December, SBN, UN Sustainable Stock Exchanges Initiative (UN SSE), and China Social Investment Forum (China SIF) co-hosted the webinar of Environmental Risk Management and Climate Exposure Reporting. Wei Yuan shared IFC’s experience of Environmental & Social Risk Management (ESRM) in banking sector.
·       In December, the South Africa Financial Sector Conduct Authority and IFC jointly organized the webinar The State of Sustainable Finance in South Africa's Retirement Sector. Louise Gardiner moderated the discussion on the key findings of the Sustainable Finance of South Africa Pension Funds Report.
·       In December, SBN and the Development Bank of Southern Africa (DBSA) jointly organized the webinar of Advancing Environmental Assessment in Africa.
·       In December, the Bank of Ghana and Ghana Association of Bankers launched the Sustainable Banking Principles training series with the support of IFC’s ESRM Ghana advisory program.  The training will be delivered through Q1 2021.


PEER-TO-PEER LEARNING

·       In June, facilitated by SBN & IFC, National Treasury of South Africa & National Bank of Georgia held a knowledge exchange session in June to share the green finance taxonomy development experience in South Africa.
·       In December, facilitated by SBN & IFC, National Bank of Ukraine & National Bank of Georgina initiated a peer-to-peer learning program on developing national sustainable finance roadmap.


MOU / AGREEMENT WITH IFC

·       In April, the Superintendence of the Stock Market of the Dominican Republic (SIMV) and IFC signed an MOU to promote green finance and the growth of the green capital market in the country, with a potential focus on developing a national green taxonomy.
·       In May, the Mongolia Financial Regulatory Commission and IFC have signed an MOU to further develop the market for green finance in Mongolia, including green bond guidelines and financing of environmentally friendly projects and practices in the country.
·       In August, the Ukraine’s National Securities and Stock Market Commission and IFC signed a Corporate Agreement to promote sustainable finance in the country.


To share your sustainable finance development achievements and actions, please contact the SBN Secretariat at
sbn_secretariat@ifc.org


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